1. The Second New Deal

2. What Was the Second New Deal About?
The First New Deal was about relief, recovery, and reform
By early 1935, FDR launched an aggressive campaign to find solutions to the lingering problems of the depression
The Second New Deal addressed issues of the elderly, the poor, and the unemployed
He faced little challenge in progressing the First Deal deal but not the second

3. The Works Progress Administration (WPA)
Appropriated $5 billion to create new jobs
Employed more than 8 million people
Spent more than $5 billion by 1943 ($11 billion)
Based on Keynes theory of deficit spending
Social Security Act
One of the few industrialized nations that did not have a form of pension system for the elderly
Insurance: unemployment insurance, victims of work related accidents, disabled
Did not benefit everyone
Proved the most popular New Deal program

4. Rural Electrification Administration (REA)
~ 10% of farmers had electricity pre-depression
Gave loans to electric utilities to build power lines in rural areas
By 1950 around 80% of farms had electricity
Did not benefit small farms
Farm prices stabilized and agriculture remained a productive sector of the economy
Public works water projects helped develop the American West
Central Valley irrigation system in California
Bonneville Dam in Pacific Northwest

5. How Did the New Deal Help Labor?
During the Great Depression there was an spike in union activity  mining to auto industry
FDR believed that the success of the New Deal hinged on raising the standard of living for American industrial workers
By doing so FDR believed the economy would grow

6. The National Labor Relations Act (Wagner Act)
Recognized the right of employees to join labor unions
Gave workers right to collective bargaining  had to negotiate with unions about hours, wages, and other working conditions
Created the National Labor Relations Board (NLRB)  looked into workers’ complaints
The Fair Labor Standards Act
Established a minimum wage (25 cent/hour)
Maximum workweek of 44 hours
Outlawed child labor

7. Congress of Industrial Organizations (CIO)
Created after AFL would not organize workers from the major industries
Established by John J. Lewis and other labor leaders
Targeted lower paid and more ethnically diverse workers and helped create more unions
The United Automobile Workers Union (UAW) staged a sit-in strike at a General Motors plant
Led to more union successes
By 1940, 9 million workers belonged to unions

8. What Challenges did the New Deal Face?
FDR won the 1936 presidential election in a landslide  won every state except ME & VT
Determined to challenge the conservative Supreme Court during his 2nd term
Schecter v US ruled that POTUS has no pwer to regulate interstate commerce  NIRA was unconstitutional
Expected SCOTUS to strike down other New Deal measures

9. In 1937 FDR approached Congress in a special address about adding up to 6 new Justices on to SCOTUS bench
Would dilute the power of the sitting justices
This plan became known as court packing
Did not have to because SCOTUS turned towards the New Deal
Was able to replace retired Justices of the Supreme Court with New Deal friendly justices

10. FDR cut back federal spending during 1935- 1936 because the economy was improving
Miscalculated and the Federal Reserve Board raised interest rates making it hard for businesses to expand and people to obtain loans
Economy took a nosedive as unemployment rose past 20%
FDR lost backing in the 1938 congressional elections  did not pursue for reforms due to importance foreign policy